Thoughts of a (mad) computer scientist

Monthly Archives: December 2017

The dramatic title of David Goldhill’s book Catastrophic Care caught my attention. I bought it, read it, and have now recommended it to a dozen or so people.

Goldhill describes the current state of the healthcare industry as an “island” unto itself. Due to many factors including regulation, history, and the legacy of government entitlement programs, the island operates quite differently than the “mainland.” The mainland, Goldhill states, houses all other industries such as banking, retail, travel and more. Because the financial incentives are vastly different on the island and the mainland, major differences in consumer satisfaction, quality, and pricing have appeared as a result. While industries on the mainland have been transformed by consumerism and digital technology, the island remains isolated, inefficient, and low-tech. Worst of all for the American economy, prices on the island are highly distorted.

The main drivers of this distortion are what Goldhill calls the “Surrogates.” The insurers, both private and government, are placed between you and me, the patients, and our healthcare providers. This gulf between the consumer and the provider causes mis-aligned incentives and financial distortion that doesn’t exist in other more consumer-driven industries. Driving the point home, Goldhill breaks down what a young employee at his company can expect to pay into the U.S. heathcare system over her lifetime and the findings are alarming. If you want to be a part of the healthcare debate, I’d highly recommend this book.